Residential Mortgage Brokers: Homebuyers' helpers

When Canadians hear mortgage broker, perhaps what immediately springs to our minds is the residential mortgage broker variety, working along side real estate agents, brokers, and bankers to help homebuyers or homeowners obtain the financing or refinancing they need. Though it may be a simplified view, this image of the residential mortgage broker is a good start to understanding just what Canadian mortgage brokers can and cannot do for consumers (residential and commercial)of mortgage products.

In the early days of the residential mortgage brokerage, newly cast, un- and under-regulated brokers made their start helping high-risk applicants find lenders willing to provide financing or even a second mortgage on existing property. While this may have opened new avenues and loopholes for the opportunistic and so-called predatory lenders to charge prohibitively high rates in many developed economies internationally, it also afforded ethical mortgage brokers and nascent professional associations a period to carve a niche and develop a profession of sourcing the right lender for a given mortgage applicant—irrespective of credit risk or financial outlook. With lower overhead and the relative freedom to shop competing loans and lenders, mortgage brokers’ singular skill set soon became apparent as they could often outmanoeuvre banks and relatively inflexible mortgage bankers in procuring the best financing available for their clients. As one Canadian mortgage brokerage online puts it, “When you negotiate with your bank, do you know your [sic] being offered the lowest rate or their best mortgage product?” (LendingMax)

Nowadays the mortgage bankers may have become nimbler, but residential mortgage broker professionals are entrenched as popular and even necessary resources on many homebuyers’ rosters of experts they rely on when negotiating the home buying process.

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